In 2015, there will be new laws governing the conduct of financial advisers in Singapore. Despite large number of laws governing the manner which financial advisers must act, majority of these laws could not be enforced. If you look at the enforcement notices posted on MAS’ websites HERE relating to financial advisory activities, almost none of the enforcement actions were related to actual … [Read more...]
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The financial advisory industry in Singapore is notorious for mis-selling. I hope to highlight this issue through this blog
Aviva SAF Group Insurance can be terminated without prior notice
Fineprints have literally become so small you need a magnifying glass to read it Very often I find that the insurance portfolio of my clients consists of buying investment linked policies with very low protection benefit but at an exorbitant premium. The only 'good' policies they have would usually be CPF’s Dependents' Protection Scheme and the Aviva SAF Group Insurance. (To those who are not … [Read more...]
Why there is no fiduciary duties between financial advisers and clients in Singapore?
Here is short transcript between Senator Carl Levin and Goldman Sach’s CEO Lloyd Blankfein. The argument is whether should Goldman Sact disclosed to clients it had betted against the security which they sold to clients. To Senator Levin, that’s considered conflict of interest. But to Goldman Sach, there is no necessity to disclose it because this is part and parcel of market making and that they … [Read more...]
ST Forum: Regulate investment seminars
There are many investment seminars and courses being conducted. You will see such advertisements in the newspaper. Very often, these courses promise the attendees high investment returns if they follow the technique taught by the trainers. Most of these trainers are unregulated and do not have a license from Monetary Authority of Singapore to give financial advice. I decided to write a letter to … [Read more...]
Similarities between botched plastic surgery and botched financial plan (or lack of it)
I read with interest in a recent article from Sunday Times on 11 May 2014 - “Beauty quests that end in tears”[1] and “The dark side to the pursuit of perfection”[2]. The articles were on the obsession with plastic surgery in South Korea and how a number of Singaporeans who traveled to the country only to come back with a botched face. As I read those articles, I thought I was reading about the … [Read more...]
Why accredited investors are in for a raw deal
Accredited investors in Singapore are high networth individuals. Accredited investors are also at greater risk of being mislead compared to others. Under the Securities and Futures Act, an accredited investor means (i) an individual — (A) whose net personal assets exceed in value S$2 million (or its equivalent in a foreign currency) or such other amount as the Authority may prescribe in … [Read more...]
Why consumers always buy the wrong financial product despite free competition?
According to an article HERE, the competition in UK financial services is not working. The article said that the UK financial services companies have not been able to win market share by focusing on customer service and good value products because consumers do not tend to switch from providers who treat them badly. The article state 4 reasons why consumers do not tend to switch … [Read more...]
Buy an IT gadget to get free insurance or buy insurance to get free IT gadget?
As I was on my way to have lunch, this poster caught my eye as there was no IT shop in my office building for a very long time. It is Prudential giving away free Samsung Galaxy Tab 2, Asus Touch Notebook, Xbox 360 Kinect, Canon Ixus Digital Camera, etc. if the client buys a Prudential life insurance policy of at least 10 years period. This is how bad the financial industry has become. It seems … [Read more...]
A very short history on commissions rebates and the dark side of the force
(22 July 2013 update below on Providend) Here is a history of commissions rebates in the life insurance industry. Prior to 2002, life insurance agents were prohibited from rebating commissions to their clients. In 2002, MAS lifted the ban in rebating commissions. The rationale was because of new rules recommended by Committee on Efficient Distribution of Life Insurance (CEDLI) and the … [Read more...]
What has paying fee for financial advice to do with iPads and China funds?
There are numerous surveys that showed that consumers are unwilling to pay a fee for financial advice. The latest one was an online survey conducted by MAS which showed that 80% of the respondents are not keen to pay for financial advice. But the question is - what exactly is ‘advice’ in the minds of these respondents? The respondent to the survey questions will answer based on his personal … [Read more...]
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